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ADMINISTRATIVE MEASURES FOR THE SALES PROMOTION ACTS OF RETAILERS
 
(Ministry of Commerce, National Development and Reform Commission, Ministry of Public Security, State Administration of Taxation and State Administration for Industry and Commerce

(Order No. 18 [2006]), September 12, 2006,

The Administrative Measures for the Sales Promotion Acts of Retailers, which were adopted at the 7th executive meeting of the Ministry of Commerce on July 13, 2006 and were consented to by National Development and Reform Commission, Ministry of Public Security, State Administration of Taxation and State Administration for Industry and Commerce, are hereby promulgated and shall come into force as of October 15, 2006.)

     
     
SUBJECT : SALES PROMOTION ACTS; RETAILERS
ISSUING DEPARTMENT : Ministry of Commerce, National Development and Reform Commission, Ministry of Public Security, State Administration of Taxation and State Administration for Industry and Commerce
ISSUE DATE : 09/12/2006
IMPLEMENT DATE : 10/15/2006
LENGTH : 1,474 words
TEXT :
Article 1. For the purpose of regulating the sales promotion acts of retailers, ensuring the lawful rights and interests of consumers, maintaining the order of fair competition and the interests of the general public, and promoting the sound and orderly development of the retailing sector, these Measures are formulated in accordance with the relevant laws and regulations.

Article 2. These Measures shall apply to the sales promotion acts conducted by retailers within the People's Republic of China.

Article 3. The term "retailers" as mentioned in these Measures refers to the enterprises and their branches as well as the individual business households which registered in the administrative departments for industry and commerce and which sell commodities to consumers.

The term "sales promotion" as mentioned in these Measures refers to the marketing activities that retailers carry out for the purpose of attracting consumers and expanding sales.

Article 4. A retailer who wishes to carry out a sales promotion activity shall comply with the principle of lawfulness, fairness and good faith and shall observe the commercial ethics. No retailer may carry out any sales promotion activity in violation of social moralities, or disturb the market competition order and public order, or impair the lawful rights and interests of consumers and other business operators.

Article 5. A retailer who wishes to carry out a sales promotion activity shall have corresponding safety equipment and management measures and ensure the smoothness of the safe passages for fire protection. For a large scale sales promotion activity such as business start, festival celebration or business anniversary, it shall work out a safety emergency plan so as to ensure a good shopping order and prevent the sales promotion activity from resulting in any traffic jam, disorder, spread of diseases, personal injuries or property losses.

Article 6. The contents of the advertisement or any other publicity for the sales promotion of a retailer shall be genuine, lawful, explicit and understandable, in which the retailer shall not use any language, word, picture or image which is ambiguous or misleading. The retailer shall not impair the lawful rights and interests of consumers under the excuse of retaining the final explanation right.

Article 7. A retailer who wishes to carry out a sales promotion activity shall display the promotion contents at an eye-catching place in its business site. The sales promotion contents shall include the promotion reasons, form, rules, time limit, commodity scope and other restrictive conditions.

The retailer shall clearly indicate the counters or goods that do not participate in the sales promotion activity and shall not declare whole-store promotion. It shall clearly indicate the exceptional commodities. If it has any restrictive conditions or promotion rules with additional conditions, the relevant characters or pictures shall be conspicuous and definite.

The retailer shall not change any of the promotion contents within the time limit as indicated after it began to carry out a promotion activity unless the change is caused by any force majeure.

Article 8. When a retailer carries out a sales promotion activity, its promotion commodities (including the awards or complimentary gifts for sales with awards) shall be subject to tax in accordance with the law.

Article 9. A retailer who wishes to carry out a sales promotion activity shall establish sound price management archives, which faithfully, correctly and completely record the prices prior to and during the process of the promotion activity, shall properly preserve them and shall accept supervision and inspection according to law.

Article 10. A retailer who wishes to carry out a sales promotion activity shall clearly mark the prices with the price tags, and pricing items shall be complete, price contents true, clear, and eligible, and goods and price mark in match with each other, and the marks conspicuous. It shall not sell any goods by increasing the marked price, nor charge any fee that is not indicated expressly.

Article 11. A retailer who wishes to carry out a sales promotion activity shall not cheat or induce the consumers to buy commodities by giving them a discount on the basis of a false original price or by marking a misleading price or taking a misleading price method.

Article 12. A retailer who wishes to carry out a sales promotion activity shall not decrease the quality or after-sale service level for the promotion commodities (including the awards and complimentary gifts for sales attached with awards). It shall not use any articles which do not meet the quality requirements as awards or complimentary gifts.

Article 13. A retailer who wishes to carry out a sales activity with awards shall display the awards or complimentary gifts. It shall not mislead the consumers by awards or complimentary gifts with false value or by ambiguous words.

Article 14. A retailer who wishes to carry out a sales promotion activity within a time limit shall ensure adequate supply of the commodities within the said time limit.

A retailer who wishes to carry out a sales promotion activity within a certain quantity shall clearly indicate the concrete quantity of the promotion commodities. If several stores of a chain enterprise carry out a sales promotion activity within a certain quantity, it shall clearly indicate the concrete quantity of the promotion commodities in each store. For a sales promotion activity within a certain quantity, a notice of termination of the sales promotion shall be given as soon as the promotion commodities are sold out.

Article 15. A retailer who wishes to carry out a sales promotion activity through preferential cards of accumulative points. It shall clearly indicate the method to obtain the accumulative points, the valid time period for the said accumulative points, and the preferential treatments to be obtained for the purchase of goods.

After a consumer gets a preferential card of accumulative points, the retailer shall not change any of the items clearly indicated in the preceding paragraph, except for the changes that will add to the rights and interests of the consumer.

Article 16. No retailer may carry out any sales promotion activity by making up a reason such as rummage sale, store dismantlement and resettlement, termination of business, suspension of business, or shifting to another business.

Article 17. Where a consumer asks a consumer to provide a invoice or purchase voucher for a promotion commodity, the retailer shall do so immediately and shall not require the consumer to pay any extra fee.

Article 18. No retailer may, under the excuse of sales promotion, refuse to return or change any commodities or set any barriers for the consumers' return or change of commodities.

Article 19. Industrial associations are encouraged to establish credit archives of commercial retailing enterprises so as to strengthen the self-discipline and direct the retailers to carry out sales promotion activities on the basis of law compliance, fairness and good faith.

Article 20. If the single store of a retailer with a business area of 3, 000 square meters or more and if the retailer carries out a sales promotion activity in the name of business start of any new store, festival celebration or store anniversary, it shall, within 15 days after the end of the sales promotion activity, submit the clearly indicated promotion contents to the commerce administrative department of the place where the business site is located for archival purposes.

Article 21. The departments of commerce, price, tax, and industry and commerce of all places shall, according to the pertinent laws, regulations and provisions, supervise and manage the sales promotion acts under their respective functions. Where any sales promotion act is involved in any crime, it shall be investigated and punished by the public security organ.

Article 22. Any entity or individual may expose any act in violation of these Measures to the aforesaid entities. These entities shall investigate and punish it after receiving the tip-off.

Article 23. Where any retailer's act in violation of these Measures is governed by any other law or regulation, such law or regulation shall prevail. If it is not provided for in any law or regulation, the retailer shall be ordered to make a correction. If there are any illegal gains, the retailer may be given a fine of 3 times the amount of illegal gains or less, but the fine shall not exceed 30, 000 yuan. If there are no illegal gains, the retailer shall be given a fine of 10, 000 yuan or less. In addition, an announcement may be made.

Article 24. All provinces, autonomous regions, and municipalities directly under the Central Government shall, according to their respective actual circumstances, formulate relevant provisions to regulate the sales promotion acts.

Article 25. The power to interpret these Measures shall remain with the Ministry of Commerce, National Development and Reform Commission, Ministry of Public Security and State Administration for Industry and Commerce.

Article 26. These Measures shall come into force as of October 15, 2006.
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